Commodities

What Are Commodities?

Commodities are raw materials used to manufacture consumer products. They are inputs in the production of other goods and services, rather than finished goods sold to consumers.
In commerce, commodities are basic resources that are interchangeable with other goods of the same type. The quality of a given commodity may differ slightly, but it is essentially uniform across producers. When traded on an exchange, commodities must also meet specified minimum standards, also known as a basis grade.

Short-term profits

There’s no real way to time the market, but if you happen to purchase and sell a commodity at the right time, you could generate a significant profit.

Best bet for price safety and surety

At the time of inflation when the economy dips, prices of commodities usually go up; in turn the prices of raw material are also supposed to have a rise in prices. Hence there will be a few commodities which can bring you profit.

Transparency in the Process

Trading is supposed to be a transparent process in commodity futures. The action will lead you to have a fair price which in turn is controlled by large scale participation. In turn it reflects different outlooks and perspectives of a wider section of people who deal with the commodity.

Trading on Lower Margin

As a trader, you are supposed to deposit 5 to 10% of the total value of the contract as a margin with your broker, which is very less compared to other asset classes. These low margins allow an individual to invest and take larger positions at a lesser capital. Tradebulls offers numerous pointed benefits as a brokerage and consulting firm for your combined benefits in commodity trading.